Greek bailout vote reignites euro crisis

[tama]

Source: Al Jazeera

European stocks open sharply down as proposed referendum on Greek bailout casts doubt on eurozone recovery prospects.

European stocks have fallen sharply in early trading after George Papandreou, the Greek prime minister, called for a national referendum on a eurozone-backed rescue package for his country's debt-crippled economy.

In Frankfurt, Germany's Dax benchmark financial index was down 3.5 per cent early on Tuesday while Paris' CAC dropped 3.4 per cent and London's FTSE opened 2.2 per cent lower.

Asian markets also suffered losses with the Nikkei in Tokyo closing down 1.7 per cent and the Hang Seng in Hong Kong ending the day down 2.5 per cent.

French banks, which are considered to be particularly exposed to any Greek default, suffered the steepest falls with Societe Generale 10 per cent, BNP Paribas 8.9 per cent, UniCredit down 8.1 per cent and Credit Agricole down 10 per cent.

Read more: http://english.aljazeera.net/news/europe/2011/11/201111182840767842.html

---

Democracy up, markets down. How surprising...

[Roland99]

1. Greek Health Minister Says Referendum Won’t Happen: Proto Thema

[earthside]

6. Collapse of the Government

I just finished the chapter on Greece in Michael Lewis's new book "Boomerang" ... what a messed-up country.

There isn't any way out of this for the Greeks but a financial and governmental disaster that will wash away all the corruption.

But that means a crisis for the Eurozone and the consequences of deeper recession here in the U.S.

Maybe this time we will let these corrupt 'American' banksters get what they deserve and we can clean-up our economic system and government, too.

[Roland99]

7. Flat-out default is really their best option.

it's best for everyone.

There's going to be one hell of "reset" and it's gonna hurt the world over but continuing to borrow and lend and stay over-leveraged is certainly no solution.

[dipsydoodle]

17. This is only part of the exposure

U.S. banks increased sales of insurance against credit losses to holders of Greek, Portuguese, Irish, Spanish and Italian debt in the first half of 2011, boosting the risk of payouts in the event of defaults.

Guarantees provided by U.S. lenders on government, bank and corporate debt in those countries rose by $80.7 billion to $518 billion, according to the Bank for International Settlements. Almost all of those are credit-default swaps, said two people familiar with the numbers, accounting for two-thirds of the total related to the five nations, BIS data show.

The payout risks are higher than what JPMorgan Chase & Co. (JPM), Morgan Stanley and Goldman Sachs Group Inc. (GS), the leading CDS underwriters in the U.S., report. The banks say their net positions are smaller because they purchase swaps to offset ones they’re selling to other companies. With banks on both sides of the Atlantic using derivatives to hedge, potential losses aren’t being reduced, said Frederick Cannon, director of research at New York-based investment bank Keefe, Bruyette & Woods Inc.

“Risk isn’t going to evaporate through these trades,” Cannon said. “The big problem with all these gross exposures is counterparty risk. When the CDS is triggered due to default, will those counterparties be standing? If everybody is buying from each other, who’s ultimately going to pay for the losses?”

http://www.bloomberg.com/news/2011-11-01/selling-more-insurance-on-shaky-european-debt-raises-risk-for-u-s-banks.html

The aftermath would occur when nobody comes up with the dough to sort the CDS's. That would cause the Sovereign Debt CDS market to disappear without trace and so increase the borrowing costs of all countries issuing bonds - austerity with a vengence.

Note that the CDS's are themselves insured too.

[Roland99]

19. Mutually Assured Destruction?

[kiranon]

60. Greece wants a better deal or it will take everyone down with it. High stakes

poker and let's see who blinks first.

[tama]

65. Not the way I see it

Greek PM waited until he saw what is the best deal Greece is getting from the Troika. And now that he has his answer, he wants to put it in a referendum.

[kiranon]

62. Greece wants a better deal or it will take everyone down with it. High stakes

poker and let's see who blinks first. Oops - meant to post below and not twice.

[Fool Count]

132. Exactly. That is a technical default triggering CDS payments,

which all this exercise is aiming to avoid. They would much rather force the banks to take a 90% haircut "voluntarily", than have rating agencies
declare Greece "in default". 90% haircut is still under 200 billion Euros in losses, which the new European stabilization fund could easily handle.
No one knows exactly how much would have to be paid up on the Greek sovereign debt CDSs, but that would almost certainly be over a trillion,
because most of those CDS are naked bets rather than insurance hedges. There is no way the issuers could cover even a part of that. As they
all go bust, the resulting unwinding will be like nothing we have ever seen. Papandreou must have figured that they would do anything to
prevent that from happening and decided to get a better deal for Greece than the 50% he already locked in. And I don't think he is bluffing,
he doesn't have to with a royal flush in his hand.

[tama]

136. Interesting point

Papandreou has admitted that when he became PM he was quite unprepared and didn't even know what CDS means. That confession tells us that now he knows what CDS means. Maybe this meeting is taking so long because he is explaining his finance minister and other members of cabinet what CDS means.

[alcibiades_mystery]

158. Exactly right. Everybody should read your post

:thumbsup:

[Fool Count]

161. Well, lough all you want at Lyndon Larouche but he was going on

about this "derivative bubble" for ages. He may be a cook and a charlatan
but he was spot on about that.

[Moostache]

11. Its been obvious since the start of this whole mess in 2008...

The ONLY way this "crisis" ends is when the bad paper that the banksters have been passing around is called to count and the losses are assigned to the banks that took on the unsustainable and unwise levels of risk in exchange for "profits" (which were always nothing more than illusory in the first place and should have remained illegal anyway).

Banking is NOT a productive sector of the economy. It was NEVER intended to be the cornerstone of a healthy economy either. What happened in the late 20th and early 21st centuries will be talked about in cautionary tones for the rest of economic history once we finally clear this mess off the books and start over (as we must).

A global jubilee period is the only way things will return to a healthy balance. The banks must simply be forced to take their medicine....and sadly, we Americans will have to down a heaping dose of our own due to allowing the "masters of the universe" to so thoroughly corrupt and co-opt our political process with their filthy lucre. It is the only way....everything else is pumping blood into a corpse and calling it "live".

[Ghost Dog]

73. Bingo.

We all need to learn from the experiences of the likes of Argentina and Iceland.

[Roland99]

2. Greek Ruling Pasok Party Majority Falls to 151, Kerdos Reports - BBG

[tama]

4. The "block of Simitis" fleeing

http://www.enet.gr/

[Roland99]

3. G-Pap's Referendum Bomb Was Secret Even From His Finance Minister

http://www.zerohedge.com/news/g-paps-referendum-bomb-was-secret-even-his-finance-minister

[Turbineguy]

5. Democracy up?

Now the Greek people get to decide. Keep bloated inefficient government and pay no taxes? Or?

There's only one thing to do when 2 trillion in wealth is evaporated in one day. Take a nice vacation in Greece, right?

But then again. Maybe Papandreou had shorted bank stocks in his personal account.

[tama]

8. The choise is

accept being ruled by the Troika of IMF, ECB and Commission - or do Something Else. What that something else is will be decided and created after the big OXI of the referendum (if and when the answer of Greek people to being ruled by foreign interests and banksters is NO!

OXI is Greek for NO and the historical background is that Greeks celebrate OXI-day remembering the refusal to submit to the demands of Mussolini in late October. This year the OXI-day celebrations was a big no to the Greek ruling class. Papandreou the III drew his conclusions and decided to let the Greek people say their OXI and declare independence peacefully and democratically in referendum - before the Greek people take over the Parliament and throw out all politicians.

[Turbineguy]

9. It would be nice if the choice

did not have to destroy the world's financial system. After all the agony over working out a (admittedly less than perfect) deal, we get this little surprise. He could have been more forthright with the others involved in this. Like it or not, the responsibility is not entirely with those who lent Greece the money.

These decisions affect millions of people, not just Greeks. Ordinary (99%ers) retirements are tied up and at risk.

By all means, the Greek people should have a say in this. Let's hope they make a good choice. And if we are not financially wiped out, maybe a trip to the Acropolis would be in order.

[tama]

12. Emancipate yourself from mental slavery

You can't eat money, and the "ordinary retirements" are just money, nothing else. Money creates artificial scarcity is world of abundance.

The current financial system is a Global Ponzi scheme and all Ponzi schemes collapse, without exception. The collapse cannot be contained in Greece or in any country, it's global and inevitable. All that the elites can do is to postpone the collapse for a while more, by hurting us more and more with their "austerity-programs", ie. artificial scarcity created by money.

The worlds financial system is evil. That is why we are occupying squares etc. and creating something else.

[Nuclear Unicorn]

34. Money is a medium of exchange, not a thing in and of its own self

Those "ordinary retirements" you cast off so dismissively are what people earned for providing goods and services to their fellow citizens. They could have taken the money they earned and lived in the moment but instead they lived less than what they were entitled to so that they might have more in later years when they were no longer directly producing.

Money didn't cause this predicament, unless money is created by fiat. Yes, in some cases it is but that doesn't cause scarcity, that cause inflation. The only way money can cause scarcity is when one person borrows money (read: someone else's productivity) from another person, does nothing productive with it and then never repays the money.

You can't wheel around a cart filled with food, clothing, building materials and luxury goods to exchange for those things you want. Money simpy serves as a certiicate that you have produced something or performed some service. You swap it with other people for their productivity/services. To think we will never have money is unrealistic. It's a tool and we need it as much as we need hammers and shovels.

The trick is to make sure it actually MEANS something, i.e. has value; as in the value of people's productivity & service.

[tama]

39. Supermarkets,

restaurants etc. are very inhospitable, There are tons of food thrown out, but you can eat only if you have money. How many houses are empty, how many people are homeless only because they have no money? Money creates artificial scarcity in world of abundance when you can satisfy your basic needs only if you have money.

Money is not a tool, it is a fetish of power. This computer is a tool - received this as a gift - and the software I is a tool. It's Linux and it's free and it is a product of gift economy and free cooperation and creativity. Linux and other forms of gift economy are not "unrealistic", they are very real and they are everywhere. When you feed your children and offer hospitality to your fellow beings, as we humans do, that is gift economy.

[Nuclear Unicorn]

43. Not gonna happen

My dad builds houses. How do you expect him to buy his tools, pay employees, vendors, materials, purchase bonds and insurance, pay taxes for the infrastructure etc. etc. etc. He does it for money. People who don't have money can't buy his houses. If he gave away his houses then the people he pays (employees, etc) don't get paid for the work they do and then those employees cannot supply for their own families. It's not like urbanites grow their own food.

I would add, that computer you're using was built by a corporation formed by people investing their money. It took engineers, laborers, janitors, marketers, retailers, salesmen, distributors, truck drivers, mechanics, fuel handlers, oil drillers, maintenance shops, architects, road pavers, grocery store clerks, banks, health care workers, road crews, tellers, loan officers, accountants, inspectors, permit clerks, dock workers, communications technicians, utilities, etc etc etc. All these people are directly and indirectly involved in supplying you your computer.

Please explain to me how you could employ a "gift economy" to account for all those people in the supply stream. In fact, most of those jobs listed are high-skilled and pay pretty decent and the low-skill jobs are are, for the most part, low risk.

I don't want to sound harsh but I think you have an overly simplistic view of what is involved in modern economies.

[tama]

46. Let's say

that I'm painfully aware of the points you make. It's a matter of cultural conditioning. How do Amish people build their houses?

[Nuclear Unicorn]

49. Who wants to live like the Amish except the Amish?

I don't.

The Amish, sweethearts though they may be, lack the economic and industrial capability. It isn't because of their aversion to technology that their lives were so simple. If their God told them tomorrow to embrace electricity they could not support their own economy without moving to abstract mediums of exchange. They don't use money because they don't produce outside their own communities. My computer example still stands because all the people involved in producing, distributing, selling and servicing are able to do so scattered across the globe because they can work for/with each other using money.

[tama]

54. We don't get allways what we want

Evolution is about both adaptation and creativity. In US the Amish communities are growing rapidly, they are acquiring more and more land, their way of life is quite sustainable compared to oil-dependent complexes, in terms of evolutionary adaptation they seem to be well prepared for the future while the high-tech mammon worshiping culture is becoming aware that it is the best candidate for evolutionary dead end.

If the worst would happen, I wouldn't mind living next to a self-sufficient Amish community, because their God tells them to feed the poor and needy without expecting anything in return. I don't have anything against that kind of God. Those kind of people would make better neighbors than your father, if he is the kind of man you say he is.

[Nuclear Unicorn]

56. Hey, I'm not knocking the Amish or self-sufficiency

My best thread on DU was when I announced I caught my very conservative husband reading Mother Earth News. He's very independent minded and we have a small parcel of land we want to develop for our personal sufficiency.

But you cannot run modern economies and productivity based on only locally produced goods and services. Your computer could never be built using only those things acquired within a day's ride and for that you need energy and money.

[tama]

64. As much as I enjoy my computer

and this ability to talk with you, I accept that basics are basics and primal production is basic and we cannot run modern economies the way we do ad infinitum. If the choice is between having a computer and cultivating the Earth in a hippie village, there is really no choice.

And as for modern economies and productivity based on money and capitalistic profit, I would very much prefer computers that were reliable, made of good parts that lasted decades and could be fixed with relative ease, rather than these over-complex products of (not-so-)free market economy that are built to break down the last day of guarantee so that the Holy Number of GDP and productivity measured in totally disconnected abstract symbols get bigger.

[NashVegas]

155. +8,000,000

Isn't it amazing? We have a generation of people out there who have no idea how we managed to get anything done, how we managed to learn anything, how we managed to socialize, before the internets.

[plumbob]

125. Your dad is not the problem. The problem is the banker who makes more

than he did when he built it. Bankers then make more again and again as the house changes hands, and even when the house sits empty, they get a nice tax writeoff.

The house is good. The builder is good. The economic fooferaw surrounding it is killing the rest of us.

Haven't used a bank or credit union since 1978. Amazing how much further your own money goes when you use it yourself instead of giving it away and then borrowing it back.

[GeorgeGist]

22. But sir,

the die was cast by the riduculous financial system whose destruction you fear.

[SkyDaddy7]

33. Can someone answer me this...

If the Greek people vote NO will they not be making things much much worse for themselves? Just curios because I admit I don't understand all there is but it seems to me the Greek people will be worse off with a NO vote.

I am not saying this because I fear it will hurt us, I am sure it will, but from a Greek person's POV should they vote YES or NO.

Please don't say NO just to be bucking the system as you see it...I want to know as a statement of fact would it be wise for them to vote YES or NO.

[Nuclear Unicorn]

38. He who pays the piper calls the tune

The people may not like the austerity measures that are part of the bailout.

OK, but it seems they are in no position to make demands of the people whose money they seem to be dependent upon. If they reject the terms their erstwhile bailer-outters are setting as conditions for the money the bailer-outters may decide to rescind their offer. If the Greeks didn't really need the money then why are they asking for the bail-out in the first place? So the verdict is -- they NEED this money ----- BAD!!!

But they can't just take the money and not change the habits that got them in to this mess in the first place. Maybe that sensible course of action would be different from what the EU is demanding and would not be as painful as the proposed austerity measures, I don't know, but I haven't heard any such proposals.

Near as I can tell they haven't really admitted to having a drinking problem, they just want one more for the road.

I think the PM just lost his nerve. He proposed the referendum ebcause he lacked the spine to take the political fire. In short, he's protecting his job with Greek voters. OK, fine. But if the voter's you're appealing to hurt themselves what have you won? The PM-ship of a bankrupt nation that produces nothing, no one will loan money to and is so riddled with civil strife tourism will die? Have fun.

[SkyDaddy7]

69. Thank-you!

That is basically the way I see the situation.

"Near as I can tell they haven't really admitted to having a drinking problem, they just want one more for the road."

[tama]

148. Ancient poem from the Greek Anthology

Anonymous:

Borrow to your heart's content.
Leave to the bankers
the cramp they get in their fingers
counting it up.

AP 16.18, translation by Peter Jay

[tama]

40. Is slavery

to supranational capital wise choise? Is it wiser to fear the punishment of the supranational capital and vote yes, or refuse to be afraid and declare independence and vote no?

What did your forefathers "vote" in 1776?

[Nuclear Unicorn]

44. Are the Greeks self-sufficient?

Will they become self-sufficient?

If you cannot feed yourself you have to beg bread. If you beg bread then you become dependent upon others. If those others are in the gift giving mood, so much the better but if they aren't, then what?

[tama]

48. Greece is very dependent

from imported oil, just like US. And the equation is very simple, if we cannot learn to become independent from imported oil, we face the other option and stop participating in evolution process.

How dependent are OWS campers from pizza donators and the gift giving mood? Perhaps we don't need to worry so much and try to control everything, and just say thanks for the pizza... and give in return what we can to those in need.

[Nuclear Unicorn]

52. I'm going to go out on a limb here and suggest...

that when winter hits well and true in NYC the OWS protesters might enjoy some imported petroluem products as well. I suppose domestically produce oil and gas would be nice but I get the feeling that's not what you're (pardon the pun) driving at.

And your pizza donation analogy fails. If the pizza/food dries up so do the OWS protesters. Once that fact becomes evident/flexed I think many in the the OWS camps will become politically "pliable."

The analogy fails on a second ground as well -- nobody is offering to supply that much pizza to the entire nation of Greece. It's not there. It's not coming. Nobody wants to. Period. So now what? You cannot move Greece to a 100% energy independent, zero petroluem, zero nuclear, self-sustaining economy that feeds its own people in time to stave-off collapse. A collpase that would bring poverty, food shortages and an erosion of civil order.

[tama]

59. You make many good points

In my hometown 'OccupyTurku' is using army tent that heats with wood, and donations of firewood have been coming - networks of solidarity is what we are building, working and learning together, IMHO thats the whole point of this rEvolution.

The food movement is already part of OWS, and guerilla gardening etc. is big and crucial part of this movement everywhere. When spring comes, we continue growing more and more local food also in cities. We adapt and learn. It's a long process and there are no guarantees, but what else to do than keep on doing what we can? Moaning and complaining does not help, trembling from fear and escaping to dreamlands and waiting for Deus ex Machina or some politician leader to do everything for us don't help...

We can have confidence that we the people DO understand that we need to work together for common good or we shall perish. Yes we can! :)

[Yo_Mama]

61. They will face a much worse immediate situation

Because the Greek government is still running a big primary deficit. The Greeks can repudiate their debt, but then they won't get any additional money and they will still have to make all the cuts.

I think the Greeks should vote no and take the hit for two years, after which the economy would have to start growing again. But the no vote would produce a terrible depression, and the average Greek worker would get hit horribly.

Their unemployment could go as high as 25-30%. Their healthcare system is already running out of drugs, because it doesn't have the money to pay for them. The result would be awful.

[SkyDaddy7]

70. Do you really think it would only be...

a two year hit for the common middle class person in Greece if they vote "NO"??

[tama]

74. It's been a 4-year hit allready

and YES to IMF & co promises only continuously tightening austerity, loss of self-governance and slavery to supranational capital and nothing else.

[Yo_Mama]

110. It would probably be much longer before they got their living standards back

But after two years the economy would start growing again.

The problem with the current deal is that it doesn't cut the Greek debtload enough to get them out of the hole - they would still be locked in a slower death spiral. The goal of the current deal is described as being for Greece to have a debt/GDP ratio of only 120% by 2020. That's awful. They need a fifty percent writedown to get back to viability.

The Greeks brought this on themselves by borrowing and borrowing and borrowing and never bothering to balance the books, but still they should be freed from the chains they forged themselves so that they can at least have hope for the future. It is their unwillingness to face up to the unsustainability of their current economy that is keeping them from defaulting, not the greedy demands of external creditors. Nothing can keep them from defaulting.

[tama]

112. And

all the 3rd world countries enjoying the good will of IMF, World Bank etc. neocolonialist institutions "brought this on themselves by borrowing and borrowing and borrowing and never bothering to balance the books, but still they should be freed from the chains they forged themselves so that they can at least have hope for the future. It is their unwillingness to face up to the unsustainability of their current economy that is keeping them from defaulting, not the greedy demands of external creditors. Nothing can keep them from defaulting."

[Roland99]

10. ANOTHER GREEK RULING PARTY LAWMAKER CALLS FOR ELECTIONS, NATIONAL UNITY GOVT - GREEK MEDIA

[dipsydoodle]

15. Link to that here

Greek PM Papandreou faces party revolt over bailout.

Six leading members of Greece's governing Pasok party have called on Prime Minister George Papandreou to resign, the day after he called a referendum on the proposed EU bailout.

One MP has defected from Pasok, cutting Mr Papandreou's parliamentary majority to two seats - 152 out of 300 - ahead of a confidence vote on Friday.

The opposition has called for early elections, saying the referendum jeopardises Greece's EU membership.

European markets have fallen sharply.

http://www.bbc.co.uk/news/world-europe-15538809

[xchrom]

13. recommend

[Roland99]

14. Emergency Greek Cabinet Meeting At 4 pm Local - Early Elections, Referendum To Be Discussed

http://www.zerohedge.com/news/emergency-greek-cabinet-meeting-4-pm-local-early-elections-referendum-be-discussed

[happyslug]

18. On a TUESDAY? Tuesday is a bad luck day for the Greeks.

Constantinople fell to the Turks on Tuesday, May 29m 1453 (Julian Calendar, the Gregorian date is still a Tuesday, but did not come into use till the 1500s so the Julian date is the better historical dating of the fall of Constantinople. I bring this up for many dates prior to the adoption of the Gregorian Calendar have been converted to Gregorian dates in many histories including some histories of the fall of Constantinople).

For more on TUESDAY being bad luck for Greeks see:
http://www.greekspider.com/superstitions/greek_superstitions3.htm

Wikipedia has a small comment on the Greek view on Tuesday on its sections on Tuesday.
http://en.wikipedia.org/wiki/Tuesday

More on the fall of Constantinople:
http://en.wikipedia.org/wiki/Fall_of_Constantinople

[dipsydoodle]

16. Greek Vote Gamble Said to Stun Euro Partners

Greece’s decision to call a referendum on its five-day-old bailout blindsided its European partners and placed another hurdle in the way of efforts to staunch the debt crisis.

The announcement came “out of the blue, it’s surprising, very risky,” Norbert Barthle, the ranking member of German Chancellor Angela Merkel’s Christian Democratic Union party on parliament’s budget committee, said in a telephone interview. “There’s an enormous amount at stake. Do we know how the Greek people will treat their government in this referendum? No. We have a new unknown.”

French President Nicolas Sarkozy will call Merkel at midday today to discuss the Greek referendum that sent stocks and the euro tumbling, the Elysee said. Sarkozy is “dismayed” by the Greek plan, Le Monde newspaper reported, citing unnamed people close to Sarkozy.

Greek Prime Minister George Papandreou’s personal and government popularity have plunged amid fresh austerity measures that sparked a wave of social unrest. He announced a parliamentary confidence vote yesterday that will conclude late on Nov. 4. The referendum will likely be held after the details of the European accord are tied up. The European Union wasn’t informed in advance of the plans, an EU official said today.

http://www.bloomberg.com/news/2011-11-01/greek-referendum-decision-blindsided-european-partners-merkel-allies-say.html

[earthside]

20. Out of touch.

It just shows how out of touch Merkel and Sarkozy and the 1% bankers and politicians are about real people.

Out of touch ... and probably scared to death.

Stunned, indeed.

Really, how could they not see this coming?
Greece is still a democracy, or did they think Papandreou would become officially a dictator?

[tama]

24. Someone said well

"Greeks have become ungovernable." They have always been unruly lot, and what is govt to do when workers refuse to punish people who refuse to pay to extra tax for IMF and other de facto rulers of Greece?

The rebel of 2008 has not really stopped, but violent tactics suffered great defeat and shame when three bank workers died when a bank was burned. Without that tragedy there is great chance that 'kukulofori' and other people would have already taken over the parliament building.

During the latest general strike, it was the stalinist thugs that protected the parliament building against other demonstrators and denied freedom of movement and expression from their fellow citizens. One member of the stalinist cader died of tear gas poisoning from the police they worked with against the people. Expression 'poetic justice' comes to mind.

[pampango]

78. If the Greek PM didn't tell them about the referendum during the negotiations,

I could see how negotiators could sense bad faith. If he told them up front that any tentative bailout agreed to would have to be approved in a Greek referendum then their Euro partners have nothing to complain about.

[TomCADem]

21. Amazing How Events In Greece Effect My 401(k)

It is a relatively insignificant country without major natural resources. Libya I can understand. Even Iran. But Greece?

[tama]

25. The birth place

of western civilization. 'Democracy' and 'economy' are Greek words. What goes around, comes around, it's poetic (another Greek word) justice that the great unravelling of this financial system (another Greek word) starts from Greece.

[Celefin]

29. Beautiful, in a way. -nt-

[FarCenter]

32. Is there any real resemblance between classical Greece and present day Greece?

The Alexandrian empire period, Roman rule, 11 centuries of Byzantine empire, and 4 centuries of Ottoman empire rule must have left a mark.

[tama]

35. Mountains

sea, olive trees. And language that is aware of it's long history.

[Turbineguy]

31. No problem

You are a slave to your fears. Just refuse to pay your bills and everything will turn out fine.

Give your paycheck back to your employer. You don't need money anymore. Grow wheat on your balcony and bake your own bread.

Don't have a balcony? Use someone else's. Tell them you are Greek and your ancestors invented Democracy. That should do the trick.

[unblock]

37. greece's gdp is five times as large as libya's

libya makes the news because it's a significant player in ONE commodity, but that one commodity is a huge portion of its entire economy.

greece doesn't have that same headline potential because it's a far more diverse economy, but all the same, it's far larger.

[Nuclear Unicorn]

45. My boss has recently laid out arguments as to why GDP is a poor indicator

Especially in a world of fiat currencies. That being said, here's some wiki data --

The service sector contributes 78.8% of GDP, industry 17.9%, and agriculture 3.3%. The public sector accounts for about 40% of total economic output.

http://en.wikipedia.org/wiki/Economy_of_Greece

That 40% public sector is the killer. It's hard to believe all those employees are maintaining roads, serving as police etc. It's akin to a manufacturing plant that put 40% of its employee capacity into filing papers. That doesn't leave much productivity left over to meet consumer demands, which is where the money comes from.

Their agri & indi percentages are too low as well. Not much self-sufficiency there.

[unblock]

50. you seem to be operating on the premise that public sector work isn't productive.

i don't know about greece in particular, but suppose they had that evil socialistic universal heathcare provided by the gubmint.
the entire health care sector could be "public sector". that boosts the "public sector" percentage of gdp, but has zippo to do with how "productive" that portion of the economy is.

conversely, the american defense industry is "private sector", but building up an army is a government function. the defense industry isn't any more "productive" just because it's private.


as to your lead in topic, i agree that gdp is over-rated. in particular, it says nothing about the distribution of gdp, nor about the sustainability or utility of the economy. a booming gdp that pollutes and depletes resources and concentrates wealth is bad, but very modest growth in a sustainable and well-distributed fashion is good.

[Nuclear Unicorn]

Yes, but no economy requires 40% of its human capital be spent on health care

Health care is valuable but that's not the argument in favor of public sector health care. The idea in universial health care (UHC, if I may be permitted) is to take out the profitability aspect that drives up costs for consumers by making it evenly distributed vis-a-vis support by tax revenues. As taxes are defined as money taken out of the GDP, UHC would not add.

UHC would be akin to building roads. The government does not build roads to make money. They are an indirect benefit to producers who in turn pay taxes to build and maintain those roads so that they may profit later on. But again, there is no money made from the roads.

But if we look at the legitimate government services -- defense, police, firefighters, infrasgtructure, healthcare etc. 40% is a big chunk. If your personal DTI was over 40 percent you could not acquire a home loan. That should be telling.

[unblock]

63. the public sector could by 100%, that's totally viable.

it's called socialism.

public/private has nothing, per se, to do with the function or the productivity thereof.
it's just a different way of organizing and having money flow through that sector.
health care can be public or private; fire protection can be public or private; same goes for transportation, housing, and energy.

all a government need to is simply make sure its income and expenses are roughly in line. there's no special challenge if, say, the proceeds from sale of oil are retained by the government. having a big public sector does not, in and of itself, make it any harder to finance.

greece's 40% public sector as a percentage of gdp has no relation whatsoever to a household's (or even a nation's) 40% debt-to-income ratio.

the relevant statistic is that greece's actualy debt is well over 100% of gdp. that's what's unsustainable, not the public/private mix.


greece's financial problems have more to do with insufficient planning and investment failures vs. its large pension obligations. it's not that pension obligations are inherently problematic, it's just that it requires advance funding that can handle a down economy, and greece didn't do that properly.

[Nuclear Unicorn]

67. But it does depend on productivity

Unless those 40% are producing goods and services that have a demand they aren't doing anything other than sucking money out of the economy.

In any system you have direct (materials and labor) and indirect costs (admin and compliance). Generally those costs pass to the consumer. However, if indirect costs chew up too much of your budget you become inefficient. There's a reason why a single payroll clerk is expected to handle dozens if not hundreds of employees; you have to distribute their indirect costs so that they are amount to mere percentages or fractions of percentages to keep the cost of production to a minimum.

[tama]

77. Booooriiiiing!!!!

If we cant yet live without money, lets create it as citizens salary. And then let everyone do what they like best. What is the demand for artists performing on streets? People creating software like Linux? People doing garden work for fun, mental hygiene and to staying fit - sharing seeds and products freely? And if some people want to sell something or buy something, nothing wrong with free market that is not controlled by monopoly of money creation.

[Nuclear Unicorn]

79. Does that mean everyone gets paid the same?

That won't work.

Why would someone stand in sub-zero temperatures for 70-plus hours a week to help produce energy if they would get paid the same as someone who sits in a climate controlled office filing papers? Unless someone is out in the freezing cold the person in the office has 1) no payroll to file and 2) no climate controlled offcie because no one is producing the energy to run that.

[tama]

81. Yes and no

The "citizens salary" wouldn't mean getting paid for anything, just the most equal way of money creation. For that money created as citizens salary to have purchasing power, that would be decided by market, supply and demand. E.g. if you don't want to chop wood for energy and want to buy logs, you create demand and hope that someone who likes to chop wood is willing to create the supply and exchange wood for money. Maybe the woodchoppers wants to horde money so that he can buy a beautiful painting from a master artist, who in turn uses the money he gets from woodchopper to pay the paper filer to get his paper clippings and other papers in order.

And maybe the people want to give the people's decentralized bank some central powers, like taxation to 1) prevent inflation and take money away from the market and 2) make joint purchases from other money systems that accept peoples money as exchange mechanism and 3) fund other common "govt" projects.

The point is democratization of money creation - nothing new, this is not that different from how most local money systems already work. Money as free contract between free citizens instead of vehicle of distortion and robbery.

[Nuclear Unicorn]

86. What you're describing is the exact same system you're talking down

For that money created as citizens salary to have purchasing power, that would be decided by market, supply and demand. E.g. if you don't want to chop wood for energy and want to buy logs, you create demand and hope that someone who likes to chop wood is willing to create the supply and exchange wood for money. Maybe the woodchoppers wants to horde money so that he can buy a beautiful painting from a master artist, who in turn uses the money he gets from woodchopper to pay the paper filer to get his paper clippings and other papers in order.

That's a free market. But the value of the currency isn't set by goverment diktat, it's decided freely between those exchanging goods and services. The reason you computer costs ~$1,000 and not ~$3,000 is because the latter price is too high. It may be 3 times more money but the former price nets more profit in the economies of scale because the people involved can reach a broader market.

And maybe the people want to give the people's decentralized bank some central powers, like taxation to 1) prevent inflation and take money away from the market and 2) make joint purchases from other money systems that accept peoples money as exchange mechanism and 3) fund other common "govt" projects.

No offense but this is a horrible idea. This is, in fact, the federal reserve system to a tee. Adding to and taking away from the money supply based on economic whimsy is what is helping drive the recession because the money has no value. It isn't based on anything. How can I charge you $1,000 for a computer if the government is just going to dump printed paper into the streets? That $1,000 has no legitimate value. It only has value if YOU earned it based on some good or service you provided. If the government dumps too much money in the street I might as well charge $10,000 because inflation is just around the corner and I have to be able to cover my own rising costs.

Point 2 is an example of playing currency markets. Hedge fund managers love those.

Point 3 is just ordinary taxation and bond selling.

Unless money is based on actual productivity it is worthless; people refuse to work for nothing. And fiat currencies are the pave stones for hyper-inflation and bankruptcy.

[tama]

90. Bitcoin

is a total fiat currency, not based on actual productivity and not distributed evenly - as my suggestion of fiat by citizens salary. But it is decentralized system and created by process called "mining" and low and behold, purchasing power of bitcoin is trumping centralized fiat currencies Big Way.

What is very harmful myth is that "people refuse to work for nothing". We already mentioned Amish, Linux etc., real life examples that falsify that myth. When Russian monetary system kept collapsing and no salaries were paid, people did not stop working. Teachers kept teaching, doctors kept treating, all grew cabbage in their small home gardens so they didn't die of hunger. We are social beings with natural need to contribute to the society - pack, tribe, community, etc. common good. Relentless 24/7 capitalistic propaganda about our "inherent greed and selfishness", which is the presumption of so called economic "theories" (in reality they are not theories but cult mythology) is having some effect, but not really working as intended, as gift economies still thrive and people treat each other as humans do, as more and more people are waking up and joining the anti-capitalistic movement and contributing in various ways.

Your claim and the point you are trying to make is self-defeating loserism. We can do better.

[Nuclear Unicorn]

93. The Amish and Linux communities are so niche as to be economically insignificant

And when the Soviets collapsed they suffered decreased government services, wage deflation, poverty, higher crime etc.

None of your examples are enviable.

Why is Linux, which is free, dead last in the OS competitions for market appeal? Why don't more people become Amish?

[tama]

103. Also

homeless people and children suffering from malnutrition "are so niche as to be economically insignificant".

[Nuclear Unicorn]

105. I think you missed my point

The reason why Linux and the Amish are such small percentages of the market of people who can obtain them is because people do not *want* to obtain them. The things they are offering are not valued, ergo they occupy a diminished market share to such a degree that they have minimal influence in the market (unlike Apple which can spawn entirely new markets).

[tama]

111. Not at all

With the same logic the things homeless people and hungry children are offering are not valued, ergo they occupy a diminished market share to such a degree that they have minimal influence in the market.

But if a poor sob like me gets an old computer from a friend, being able to make it run with Linux and other copyleft software totally free and more reliably than with M$ (which is pre-installed in practically every new computer in the market) is very meaningful to me, how ever small and meaningless market niche I am.

Also many South American and other governments have chosen Linux for the very reason that it is open source (and not laden with NSA spy-holes etc.). Finnish government sadly chose M$ at the recommendation of a guy who soon afterwards got a well-paying job at M$.

[Nuclear Unicorn]

118. Not the same

There are a myriad of reasons folks are left destitute, i.e. medical expenses, substance abuse, disability, etc It overwhelms their ability to provide for themselves. It's tragic and it's heartbreaking.

If, however, those who are this unfortunate could provide valued productivity they wouldn't by that unfortunate because people would pay for their goods/services. But a man crippled in a carpentry accident cannot work as a carpenter. If he could he would still be working.

That's not to say anything is his fault or that society should not help. Society can do much and the reason we have a social safety net is because we are so productive we have productivity to spare for charity and social programs (BTW - money is the medium for these actions). If we had to work full-time for a slightly-above-subsistence living we wouldn't have the surplus productivity to care for our neighbor who was injured.

That's not the same as noting that the reason the Amish are such a small niche in society is because nobody wants to live like the Amish. Have you noticed how popular smart phones are? The Amish don't have those. Angry Birds > Amish in the eyes of free economic exchange.

[tama]

128. Well

The problem is that we don't work full time for a slightly above subsistence living - satisfying basic material needs self-sufficiently and without any money even in harsh climate like northern Finland takes only four hours per day - proven in practice by a friend of mine. So he has plenty of time to help others and he does - for free. And no, he's not Amish but a man of conscience who enjoys life very much, being free from money economy.

The problem is that people in monetary system are forced to work more and more and more doing mostly work that is not only unnecessary but also harmful to the environment and general well being, In fifties an ordinary wage earner could support a whole family with one job, nowadays more and more often both adults of a family need to work both two or three jobs just to keep their children SLIGHTLY-UNDER-the malnutrition border - in US. Just to avoid severe starvation.

I've lived - proudly - in a community where dumpster diving was the main source of food. Proudly because the mindless waste of food caused by power of money is criminally insane. Now I can't because all the supermarket in walking distance are barred from dumpster divers and I don't have a car nor driving license.

[ieoeja]

88. Those guys working in the cold are paid more than the millionaires in the offices? n/t

[Nuclear Unicorn]

89. Sometimes the millionaire earns what he makes

Would it be worth it to you to pay $1 million to save and/or earn $10 million?

My boss makes pretty coin putting together real estate deal for people wanting to start businesses, generally in the manufacturing sector. We handle everything from site selection, to insuring utilities and infrastructure, compliance, covenants, etc etc etc If people end up on the wrong site with property they cannot fully utilize they could lose tens of millions of dollars. That also means their workers lose their jobs. In other words, it is worth it to the people who pay my boss to see that he hires the right staff (me!) to help make sure we're sure about where they're setting-up shop.

My husband, on the other hand, works like an animal. He has long hours doing extremely physical labor (two words: yum. mee.) and most of it is outdoors when weather can go below zero or above 100. Now, my husband doesn't earn as much as my boss because he couldn't do the same job saving people the same amount of money. However, he earns a lot more than me. Moreover, my husband got a big raise not long ago when he was made supervisor because his boss thinks he is worth the money for the overall operation.

[tama]

91. My heart hurts

what else can I say?

[Nuclear Unicorn]

97. Why?

Isn't it a good thing we make sure a proposed facility is environmentally compliant? Doesn't it matter that a factory have water, electricity and roads? Shouldn't the new factory owners work WITH the local government? Shouldn't it make sure its operations don't foul local water supplies?

These are good things and they benefit the factory owners, the employess and the local community. Someone has to be th subject matter expert for these things and our clients pay my boss what they think it is worth. If my boss charges too much then he prices himself out of the market. If he charges too little I probably won't work to finish off the latest report because it won't pay my bills. I am entitled to my home and car, right?

[tama]

102. It was just a sensual observation

asking why and reading your post now makes my head hurt, also.

Too many presuppositions that I'm unable to share and believe in, and have no stamina to continue discussing. I just don't believe in money and need for bosses.

[Nuclear Unicorn]

108. It's not magic. It's not some nefarious scheme

It's just real people bringing order to endeavors that would otherwise be too burdensome to undertake. As a result of that ordering we have a society that not only gets us homes, food, clothing and transportation but also medicine, mass communications, luxuries etc.

It is no more evil than fire which can warm a home or cook food or destroy an entire forest.

[tama]

114. Is that so?

"As a result of that ordering we have a society that not only gets us homes, food, clothing and transportation but also medicine, mass communications, luxuries etc."

It seems to me that the "we" of your sentence is getting less and less inclusive and more and more people are going homeless, hungry, etc. etc. excluded from those who you consider "we". I must have missed the news and stats you are watching, nice to know everything is nice and cosy and nobody is left behind.

[Nuclear Unicorn]

122. You're allowing the perfect to be the enemy of the good

You can't build homes unless you have lumberjacks to harvet wood, mills, roads, electricity, water, carpenter, electricians, machinists, utility companies, etc

Where do you think homes come from? How are you going to systemize the production of homes for 300 million people? Are you going to make all the people involved work for free? Barring personal misfortune that prevents someone from working what do people do to earn their homes?

[tama]

124. That is a good saying

I use it a lot also. But maybe I have different standard for what passes for good.

And I have many friends who can build their own homes and have done so. They are not Amish but live in an ecovillage and the houses they have built are admired masterpieces of ecological building, helping each other for free, homes with all the comforts without need to be hooked to the grid or plumbing. The houses they have built will last for centuries, while the standard element houses build by systemized commercial builders last only few decades - at top. I have friends who can build yurts and teepees, I have friends who can fix old houses, I have friends who like to live in what are today "posh" areas, with old houses that were build decades ago by ordinary people as their own homes in then "poor" areas.

While no builder myself, yes I believe I know where homes come from. Good homes.

[ieoeja]

106. The problem is that those in the financial industry typically do not.

I worked there. I know. These are not the sharpest pencils in the box.

Everything was about personal greed. For instance, every employee below you in your chain of the command multiplied your annual raise. The more you hire, the more money you make. As I was single handedly doing a job that previously required three people to do, they spent considerable effort trying to fire me.

The bank President's #1 accomplishment, for which he received a huge bonus, was contracting with a telco company to replace all our equipment. By a remarkable coincidence he was also CEO of that very same telco company where his biggest accomplishment was landing the bank as a customer for which he received a very large bonus.

You see why people might have a problem with this game?

[Nuclear Unicorn]

107. That's a crappy business model

Are all those hires actually providing things to the customers?

[ieoeja]

149. Who cares if the workers are productive? Management made more money.

And the weird thing is, they honestly believed that they were doing good. They believed that the greedier someone was, the better job that person would do. They could make decisions that benefited themselves at the cost of the bank and believe they were good employees. Get ready for a mind-f*** as I try to detail their logic.

First, you have to understand how they judge a person's worth. Let's say you kick dogs, drown cats, hate children and stole your parents money. Here is how they read that sentence, "let's say you, blah, blah, blah and blah money." Money makes you a very good person. Money trumps everything.

Exact quote from one of my bosses directed at me while I was working for the bank, "I assume you're no good since you don't make a lot of money." He said that to me in all sincerity.

So they make a decision that benefits themselves, but hurts the bank. However, they do now get more money. The more money you get, the better you are. Therefore, they must be doing a better job.

See?


I am sure this sounds unbelievable. But it really is true.

Not that stupid millionaire workers are limited to the financial sector. It's just that the financial sector pretty much encourages it. Lest we forget, the creme de la creme, the brightest of the brightest, all of them Harvard and Yale MBAs, bankrupted every major financial institution in the United States in 2008.

How could they *all* be simultaneously stupid, if the problem was not institutional?


In the non-financial sector I have plenty of stories too.

I fixed an error that would have cost us $26 millon dollars. CIO rejected it because it wasn't my job to fix it. So we lost $26 million dollars.

A woman making half a million a year sent me to Hong Kong to work on a computer that did not exist. When I pointed out to her that the computer did not exist, she responded, "that won't be a problem." I mean, hey, I'm good. I'm really, really good. But even I can't work on a non-existent computer. So I went to Hong Kong and worked on the computer back home in Chicago. A bit expensive, but....

A conversation with that same woman before we put the first office into production....

Me: In table1 you have them putting A into field1 and B into field2. In table2 you have them doing just the opposite, putting B into field1 and A into field2. Field1 in both tables share validation. Field2 in both tables share validation. So they should be the same. In table2 we should put A into field1 and B into field2 like we do in table1.

Her: We can not put A into field1.

"Why?"

"Because that is where we put B."

"So put B into field2."

"We can't do that. Then we would lose A."

"Not if you put A into field1 instead."

"But then we would lose B."

Lots of drawing on white boards. She starts getting angry.

Me: "Oh, you're right. I guess I was just confused." A lot of people got fired on that project. I learned to shutup and embrace the stupid when it was apparent I wasn't going to win. I am glad to say the CEO, COO and CIO were fired because of this project. Oddly, they still loved this woman who was the #1 problem. But she ran as soon as they fired those above her anyway. After that we were able to fix a lot of these problems.

But she got her million bucks for two years work.

[tama]

154. Money blinds. It's a cult. nt

[Blue_Tires]

157. holy damn...that is beyond crazy...

[plumbob]

127. Mmmm, I worked in the oilfield for two decades, and I can assure you

that NO ONE is standing out in the freezing cold for 70+ hours a week producing energy.

I worked in the San Juan Basin and the Permian Basin as well.

[tama]

51. In local universities

they are hiring more and more bureaucrats who make constant organization changes and control work hours etc. etc. And they are laying of teachers, who have no time to teach anyway, because of all the forms they have to fill for the bureaucratic controllers.

On top of that ministry of education is hiring economists and consultants that say that universities must get private funding to pay salaries for economists and other bureaucrats and that the pink slip teaching personnel and students without teachers must add to the GDP by finishing their studies in no time with plenty of work experience from private sector and all the top academic skills and knowledge and social networks that neoliberal competition society and employability requires. Go figure...

[Nuclear Unicorn]

57. this ^

[Celefin]

68. this^ x2

been there, done that, got the scars and said fuck it.

[Celefin]

23. Democracy up, markets down. Sly move.

First of all, even if you think this is the worst they could do, you have to at least smile a bit at the irony.
Good comment, tama.

It's probably the best he could do.
If Greece defaults in a crash and burn manner, taking Europe with it, he gets to shift the blame to the people and Europe and gets to keep his life.
If the vote is yes and Greece goes to the dogs and into generations of debt slavery, he gets to blame the people and gets a boardroom position somewhere.

If on the other hand, the vote is no, Greece defaults and somehow manages to pull off an Argentinian-style success story... then he's a hero.

Sly move.

[bemildred]

26. Well, it's the right move, elections are supposed to be the source of political legitimacy.

And political legitimacy is badly needed by the government of Greece.

[Celefin]

27. Certainly.

Just not sure if I want to credit the president with the intention of doing 'the right thing'.

Bur I can't know that, of course. He might be genuine.
It's been known to happen, albeit not very often in recent times.

[bemildred]

30. Oh, I quite agree, he looks like a typical self-serving smoothbrain poiltician.

I doubt that he had much choice, unless you consider being tarred and feathered and rode out of town on a rail an alternative. But it's still the right thing to do.

[tama]

28. This was

Papandreou III's personal OXI-moment. He said NO, I'm not going to surrender Greek independence to supranational capital alone. When Metaxas said OXI to Mussolini, Greeks united and defeated the Italian army and Hitler had to send his troops to Balkans, which postponed Barbarossa and probably saved Russia.

Now Greek people have their own chance to unite and say OXI to the rule of supranational capital peacefully and as a nation - if George survives the anti-democratic mutiny in his own party. If he doesn't the likelihood of violent revolution keeps on growing.

[pampango]

36. "...the center-right opposition New Democracy party stepped up its calls for early elections."

"...the center-right opposition New Democracy party on Tuesday stepped up its calls for early elections. Its leader, Antonis Samaras, has opposed most of the austerity measures the government accepted in exchange for foreign financial aid. Mr. Samaras has said that if he were in power, he would try to renegotiate the terms of Greece’s arrangement with its principal foreign lenders, known as the troika: the European Union, the European Central Bank and the International Monetary Fund."

"...after weeks of mounting pressure, one Socialist lawmaker quit the party to become an independent, reducing Mr. Papandreou’s majority to 152 seats out of 300 in Parliament, and another six Socialists wrote a letter calling on Mr. Papandreou to resign and schedule early elections for a new government with greater political legitimacy. Together, the developments made it doubtful whether his government would survive a confidence vote planned for Friday."

http://www.nytimes.com/2011/11/02/world/europe/markets-tumble-as-greece-plans-referendum-on-latest-europe-aid-deal.html

[Roland99]

41. Banks to move ahead with Greek debt deal: IIF

http://www.marketwatch.com/story/banks-to-move-ahead-with-greek-debt-deal-iif-2011-11-01?link=MW_home_latest_news

[Roland99]

42. Double Your Money In 6 Months: 1 Year Greek Yields Pass 200% For First Time Ever

http://www.zerohedge.com/news/1-year-greek-yields-pass-200-first-time-ever


youch.

[lovuian]

47. Iceland defaulted and the people in Iceland are going to do

just fine and the people of Greece will do just fine

when they default

Default is going to happen read it and weep

but life will move on
the people are not going to vote to be slaves for the New World Order

[dipsydoodle]

53. Since when was Iceland in the EU ?

.

[Harmony Blue]

55. Argentina wasn't either

but not letting the IMF dictate the fate of either country turned out for the better.

[dipsydoodle]

58. Just for clarity

I expect Greece to default, go back to their Drachma and then just deal with what's left.

At present it looks like that is what they intend to do AFTER they receive the next traunch of funds aka mugging off the rest of the Eurozone countries.

Aside from that Icelanders pay their income tax and Argentina has mineral resources. Greece has got sfa in either respect.

[tama]

71. My country is in the Eurozone

one of the very few with triple A rating. And no, it's not Greece and especially Greek referendum that is mugging my country. We ain't as stupid as you think we are, we don't blame Greece, we blame banksters, euroelites and our own corrupt politicians. And also we demand referendum about EU-policies, popular support being at historical low. Also we want more and better democracy, not this tyranny of oligarchs.

[T_i_B]

82. Back to the Drachma?

Greece shouldn't really have been allowed into the Eurozone in the first place, and I do think that they would be better off leaving the Euro, but so many people have invested so much political capital into the Euro project and that's the very last thing the EU would want.

[tama]

87. I'm certain

that Britain - "who never should have allowed into the EU in the first place", as Frogs think, shed the required amount of crocodile tears. :)

But it's more fun to watch the events in Greece than to discuss how great the British economy is doing... it would be all just fine if only the Icelanders accepted that they as a nation own Britain and Netherlands all the money that innocent British savers invested in Icelandic banks... and as they don't, fuck the terrorist nation of Iceland!!! :P

And worst of all, Icelanders don't really care about your threats and fear mongering and distortion, they just gave you the finger, not just in one referendum but twice! :D

[T_i_B]

94. What on earth are you yabbering on about?

I was discussing Greece, not Iceland and it's far better when looking at Greece to think of what would be in the best interests of Greece then gawping gormlessly at an avatar of a Union Jack.

[tama]

104. Sorry

but when discussing Greece, Union Jack raises many unpleasant memories. When I started learning Greek language, one of the first Greek songs I heard was about the events of December 1944.

[dipsydoodle]

120. We discuss and may not always agree

but its never personal.

:hi:

[dipsydoodle]

141. Despite that

Argentina tightens dollar exchange controls.

The Argentine government has imposed new restrictions on the purchase of US dollars, in an attempt to reduce capital flight and tax evasion.

People wanting to exchange Argentine pesos for dollars must now explain where they got the money, and show they have paid their taxes.

Currency trading in Buenos Aires on Monday was much reduced as a result.

Many Argentines buy dollars to protect their wealth from inflation - thought to be higher than officially stated.

http://www.bbc.co.uk/news/world-latin-america-15532101

[hack89]

66. After severe austerity measures, large tax increases and a big drop in personal income.

All the things the Greeks want to avoid.

[Celefin]

72. If it had a purpose they'd go with it

Just as in Iceland where they had the prospect of getting back to prosperity within the decade. They're already recovering.

The only prospect for Greeks if they go along with this is a generation of debt-slavery.
There is simply no point for ordinary Greeks to accept all this hardship under these conditions.
There will be no recovery.

[hack89]

80. Then Iceland's example is irrelevant to Greece.

and Greece has no viable future as a first world nation. Let's remember one salient point - Iceland is doing "ok" because it regained access to the world financial markets. That is not an option for Greece on their present course.

[tama]

84. The Iceland's example

is not irrelevant to anyone. Just say NO to IMF, because surrendering to IMF rule is the worst choice any nation can do.

And this may shock some Americans, but nobody has any god given right to be a first world nation by keeping the rest of the world in neocolonialist debt slavery. You know, the "others" don't really enjoy "Pax Americana" any more than any other violent empire that don't know how to live without robbing others.

[hack89]

92. "No" means no credit

which means draconian cuts to the Greek budget. It is not hard to understand - you may not like it but you have not put forward an alternative that will not hurt the Greeks.

You do realize that it is German and French banks that have Greece by the balls? This is not an American issue.

[dipsydoodle]

98. No means

they get used to paying income tax.

[hack89]

99. On top of cuts to government services.

I am not sure perfect tax collection would cover the amounts they were borrowing.

[tama]

109. In ancient Athens

Drakon the Tyrant (cf. draconian measures ordered by the IMF-led Troika) was followed by Solon the Wise, who ended debt slavery of small farmers and established Athenian democracy. Let the history rhyme.

Greek people, if the referendum happens, have German, French, British and American banks by the balls. Let the debt-slaving tyrants fall. The fear of direct democracy in Greece apparent with many DUers seems to have more to do with fear of their 401 losing value than empathy with the Greek people.

[hack89]

131. There is no winning for the Greeks

they will suffer a lot. It will fundamentally change their society - they are a poor country living beyond their means. Regardless of what happens to the banks there is no way the Greeks will come out of this with a better society.

[tama]

133. Depends

on your definition of "better society". Like 'democracy' also 'anarchy' is a Greek word, and the idea of self-rule instead of being ruled by any rulers is quite popular in Greece today. As a matter of fact, during all the years I lived in Greece, never heard any Greek to have anything good to say about Govt. But I saw that if Greeks didn't like a particular law that legislators legislated, they just didn't care and forgot about it. Very honest, hospitable and supportive people - except the politicians, soccer teams, etc... :D

[hack89]

134. The Greeks want every thing they have now

generous retirement, medical care, strong social programs. Those things will go away when they default - they can't borrow the money to pay for them.

It has nothing to do with laws - it has everything to do with living within their means.

[tama]

135. Living within means

goes for all of us. Especially parasite banksters who don't do productive work but "make the money work". And Greek consumerism is still quite modest when compared to the American consumerism - which is really unbearable for our common planet.

[hack89]

143. Consumerism is not what is killing the Greeks

it is unaffordable government services. They will have to work longer and harder for less.

[tama]

147. Bullshit nt

[hack89]

150. Here is a news flash - you have to pay for things you want.

and if you don't have enough money you get less of what you want. The Greek economy has never shown the capability to fund what the people want - why do you think they have such massive debt?

You tell me - just how will the Greeks fund all their social services without borrowing money?

[tama]

153. So when you want sex you buy it?

News flash - it's better when it is free and based on love instead of power of money.

News flash - Greek society has never relied on strong central state for social services. they rely on strong family ties. The public education and health care systems are a joke, all who can afford take their children to private schools and use private health care, and the paper pushing bureaucrats of the nepotist power hierarchy will not be sorely missed. As the state structures crumble, people self-organize their own health care services, because those that can heal don't stop healing when they don't get money. A healthy society does not need greedy bastards who do things only for money.

[hack89]

156. So why they rioting over pensions and healthcare cuts?

you are not making much sense here.

Secondly, if the Greeks are so socially conscious why don't they simply pay taxes? Don't you think tax evasion is a very selfish act?

[tama]

159. They are not

Those rioting are anarchists who want to get rid of state. Leftists and union members and opponents of extra property tax don't riot but demonstrate against and for various causes and its all very complicated.

The issue of tax avoidance is not at all so simplistic you think. Tax evasion by rich people who can move their funds to tax havens and pay no tax at all is certainly selfish. Ordinary small Greek business, that sometimes makes business without receipt thus avoiding VAT, saves some money to help his extended family and most importantly, to pay to usual amounts of bribes to public servants when in need of permits, public health care etc. And further moral issues about tax evasion are paying for things you don't accept in what governments do - military, police oppression, harmful bureaucracy, nepotistic corruption etc. But in the end, Greeks pay their taxes just like other peoples do, VAT, progressive taxes on wages, etc. etc., in a tax system that in terms of bureaucratic complexity is rightfully called 'bysantine'.

Are you yourself, BTW, 100% honest when filling your IRS, do you meticulously announce everything that could be taxed? I'm not. Not so much because I wouldn't mind paying the money, but because I just want to avoid all bureaucratic paperwork I can avoid. I hate that shit. I'm just human, and I accept others are too... :)

[muriel_volestrangler]

113. Iceland didn't say 'no' to the IMF

it worked extensively with it:

Posted on 28 August 2011

The International Monetary Fund decided at a meeting this week that conditions are right to end its Icelandic financial revival programme on schedule at the end of this month. The final tranche of funding was also approved by the board.

Unemployment is still high in Iceland, but the rate increased slower than had been feared and has not been lower since before the banking crash, Icelandic government ministers explained at a press conference. The programme of co-operation between the IMF and the Icelandic government is now officially at an end, Visir.is reported.

The end of the programme means not only that loan payments to Iceland are now complete and no further IMF funding is expected; it also means that the IMF’s permanent presence in Reykjavik and its strong influence on government policy will also come to an end.
...
According to the government, Iceland’s co-operation with the IMF has strongly emphasised the achievement of results in core areas. Financial stability has been regained. The financial sector has been revived and restructured. State finances have been stabilised through spending cuts and tax rises and the state’s increasing renewed respectability on international markets has been illustrated by June’s successful bond issue, ministers say.

http://www.icenews.is/index.php/2011/08/28/iceland-and-imf-part-company

[tama]

115. IIRC

in the referendums Britain and Netherlands very clearly expressed that if Icelandic people don't comply to their demands, they use their influence in IMF, EU and elsewhere to fuck Iceland every way possible. There was lot of fear mongering, Icelanders didn't buy it and were not frightened.

[muriel_volestrangler]

119. That would be 'saying no to the UK and Netherlands', then

which doesn't apply to anyone other country (that is a dispute about money directly with those 2 governments that covered the promised amount of foreign deposits when Iceland decided not to; there is not a similar situation elsewhere).

[tama]

137. From wikipedia

"On August 28, 2009, Iceland's parliament voted 34-15 (with 14 abstentions) to approve a bill (commonly referred to as the Icesave bill) to pay the United Kingdom and the Netherlands more than $5 billion lost in Icelandic deposit accounts. Initially opposed in June, the bill was passed after amendments were added which set a ceiling on the payment based on the country's gross domestic product. Opponents of the bill argued that Icelanders, already reeling from the crisis, should not have to pay for mistakes made by private banks under the watch of other governments. However, the government argued that if the bill failed to pass, the UK and the Netherlands might retaliate by blocking a planned aid package for Iceland from the International Monetary Fund (IMF)."

Icelandic voters were told that NO would mean no more IMF loans. They didn't care and voted NO.

[muriel_volestrangler]

142. And again, I'll point out that Iceland was having an argument with UK/Netherlands

and the UK/Netherlands threatened to block a loan from the IMF - ie a loan which Iceland had already agreed with the IMF. Iceland had been working with the IMF, and it continued to work with the IMF (all Wikipedia says is there was a threat from UK/Netherlands, and as my link showed, the IMF seems happy with what it's done in Iceland). The IMF continued to make loans to Iceland, after 2009.

Saying "Iceland said 'no' to the IMF" is highly misleading.

[tama]

144. Iceland and IMF part company

http://www.icenews.is/index.php/2011/08/28/iceland-and-imf-part-company/

Parting on polite terms and as you say, IMF seems happy at least publicly. And any case, the threat of earlier parting was real and voters made aware of it - unlike govt and althing - didn't hold on to the company of IMF at all costs when they voted no.

We cannot know for sure what would be the role of IMF today in Iceland if there had been no referendums against demands and fear mongering of UK/Netherlands and more debt slavery, but IMHO it is safe to assume that the NO of referendums as well as other political developments and judicial processes in Iceland had lot to do with general climate and this polite parting of company.

[dipsydoodle]

116. Is it true that their EU membership will be vetoed

by the UK and Holland until they cough up?

[muriel_volestrangler]

121. As far as I can tell, that is still the case

but something may be worked out eventually. The enthusiasm for joining the EU seems to be dying in Iceland, though, so they may just decide to end the application process. After all, the EU may be a bit turbulent in the next year or two; it might be better to wait until the dust has cleared before committing.

[Imajika]

75. Sounds like Greece is already cancelling the referendum...

At least according to one Greek Socialist "official". That didn't take long if this story is to be believed.

http://www.cnbc.com/id/45117001

"Stocks trimmed some losses in volatile trading Tuesday after a report that said Greek Prime Minister George Papandreou's referendum call is "basically dead," according to a socialist party official....(more)...

[DeSwiss]

76. K&R

I'm not sure what game Papandreou is playing here, nor even whether Papandreou knows what game he's playing here. But I bet no one in France, Germany or the IMF saw this one coming.

- The point is, no matter how you stack 'em, they're still coming down......













http://www.youtube.com/watch?v=hklqkwyISuk">''All tyranny needs to gain a foothold, is for people of good conscience to remain silent.'' ~ Thomas Jefferson.

[Roland99]

83. GREEK GOVERNMENT SPOKESMAN TOLKAS SAYS REFERENDUM TO GO AHEAD

http://www.zerohedge.com/news/greek-referendum

[tama]

85. ZHTO! nt

[dipsydoodle]

95. Fantastic

Democracy at large.

Hopefully they'll leave the Euro and maybe the EU too.

BTW that. is subect to Papandreau surviving Fridays vote of confidence.

[bluebuzzard]

96. Top brass replaced

http://www.athensnews.gr/portal/8/49916

[dipsydoodle]

100. Apparently that was already scheduled

and is unconnected with political events.

[DeSwiss]

101. I believe the lede.....

...in this article, is just more wishful thinking on the TPTB's part:

''In a surprise move, the defence minister proposed on Tuesday evening the complete replacement of the country’s top brass.''

- Besides, I don't think the armed forces has anymore bullets. So they're basically a bunch of guys in fancy dress.....

[tama]

117. When George was a little boy

he saw the goons of Junta taking his daddy away.

[dipsydoodle]

123. BBC live text link here

Past midnight in Greece and meeting is still going on after more than 5 hours.

http://www.bbc.co.uk/news/world-europe-15539642

[tama]

129. Not Tuesday anymore

But BBC journalism is very ugly... all the "people of the street" against the referendum, foaming member of Greek Chamber of Commerce inteviewed, only remotely reasonable voice being the German correspondent of Die Welt...

[dipsydoodle]

140. Was 10.50pm GMT Tuesday here in the UK when I posted that

Referred to this timed at :

2224:

It's now after midnight in Athens and the emergency meeting of cabinet is still going on. The prime minister and his ministers have been sitting together now for more than five hours.

[tama]

145. My local time

is same as in Greece, and I posted past midnight. Meeting lasted 7 hours, and G-Pap prevailed, at least until Friday.

[yurbud]

126. subtext: bankers and speculators panic when Greek PM resorts to DEMOCRACY

to stop austerity.

[Kaleko]

139. That's right.

Nice summary.

[workinclasszero]

152. You got it

The banksters hate real democracy, a lesson the world needs to learn.

[tama]

130. Robert Reich blogs: Democracy of Finance

Greece’s Choice — and Ours: Democracy or Finance?

Tuesday, November 1, 2011

Which do you trust more: democracy or financial markets?

Greek Prime Minister George Papandreou decided in favor of democracy yesterday when he announced a national referendum on the draconian budget cuts Europe and the IMF are demanding from Greece in return for bailing it out.

(Or, more accurately, the cuts Europe and the IMF are demanding for bailing out big European banks that have lent Greece lots of money and stand to lose big if Greece defaults on those loans – not to mention Wall Street banks that will also suffer because of their intertwined financial connections with European banks.)

If Greek voters accept the bailout terms, unemployment will rise even further in Greece, public services will be cut more than they have already, the Greek economy will contract, and the standard of living of most Greeks will deteriorate further.

If Greek voters reject the terms and the nation defaults, it will face far higher borrowing costs in the future. This may reduce the standard of living of most Greeks, too. But it doesn’t have to. Without the austerity measures the rest of Europe and the IMF are demanding, the Greek economy has a better chance of growing and more Greeks are likely to find jobs.

Shouldn’t Greek citizens make this decision for themselves?
http://robertreich.org/post/12200736000

[rayofreason]

138. Beware of Greeks rejecting gifts. n/t

[tama]

146. Good one! :) nt

[workinclasszero]

151. Haha :) /nt

[Roland99]

160. GREECE BAILOUT REFERENDUM HAS BEEN SCRAPPED

This time from AP:

GREECE BAILOUT REFERENDUM HAS BEEN SCRAPPED
Officials close to Greek prime minister tell Associated Press bailout referendum has been scrapped